Tuesday, January 17, 2006

Iran's nuclear crisis: Will Russia and China eventually budge?

Kash Kheirkhah

AP reports that key European countries and the United States are moving ahead with plans to refer Tehran to the U.N. Security Council while Russia and China have urged negotiations instead of confrontation, casting doubt on the result of next IAEA meeting.

A meeting Monday in London produced no agreement among the United States, France, Britain and Germany and Moscow and Beijing on whether to refer the dispute over Iranian nuclear enrichment to the Security Council.

Russia maintained sanctions were not the best way forward, while China again called for a return to the negotiating table.

So will economic considerations set Russia and China against the West in the days ahead?

No. Not according to Dr Alireza Nourizadeh, a prominent London-based Iranian analyst who follows the latest developments in Iran's nuclear program closely. Yesterday, in his weekly Persian TV program, Dr Nourizadeh predicted Russians and Chinese would eventually choose not to block the US and EU-3 efforts to refer Iran to the UN Security Council:

Russia desperately needs more than 10 billion-dollar-a-year US investment for the next 25 years. EU alone has 12 billion dollars' worth of interests in Russia. In fact, what has kept Russia on Iran's side is not so much the economic interests as much as it is the political ones. The Russians are playing Iran as a political card against the West although they know they can play this card only up to a certain limit.

China, on the other hand, is as the world's biggest energy consumer and has recently signed a $ 100 billion energy contract with Iran, but America will easily be able to find China alternative markets in countries such as Kazakhstan, Turkmenistan, Iraq and most importantly Saudi Arabia which is now in talks with the Chinese and is ready to increase its oil production up to three million more barrels.

So what could happen next? Again, Dr Nourizadeh:

In London, world powers reviewed three major options as to how to handle Iran's nuclear crisis:

First, Iran's referral to the UN Security Council: issuing a harsh warning to Iran and setting a deadline for the Iranian regime to return to the full suspension of its nuclear fuel research.

Second, symbolic Sanctions: barring Iranian diplomats and leaders from traveling abroad, recalling ambassadors and reduction of trade and diplomatic ties.

And third, smart sanctions such as blocking the export of gasoline to Iran.

For now, Russia and China have only joined Europe and the U.S. in criticizing Iran's resumption of uranium enrichment. But both have also said that they would prefer to avoid Security Council involvement and are outright opposed to sanctions. It now remains to be seen how the United States and its European allies will be able to convince Russia and China to support Iran's referral to UN (and later sanctions) in the run-up to the emergency meeting of IAEA on Feb. 2.

UPDATE: Charles Krauthammer of The Washington Post takes the exact opposite view of Dr Nourizadeh:

First, because Russia and China will threaten to veto any serious sanctions. The Chinese in particular have secured in Iran a source of oil and gas outside the American sphere to feed their growing economy and are quite happy geopolitically to support a rogue power that -- like North Korea -- threatens, distracts and diminishes the power of China's chief global rival, the United States.

Second, because the Europeans have no appetite for real sanctions either. A travel ban on Iranian leaders would be a joke; they don't travel anyway. A cutoff of investment and high-tech trade from Europe would be a minor irritant to a country of 70 million people with the second largest oil reserves in the world and with oil at $60 a barrel. North Korea tolerated 2 million dead from starvation to get its nuclear weapons. Iran will tolerate a shortage of flat-screen TVs.

The only sanctions that might conceivably have any effect would be a boycott of Iranian oil. No one is even talking about that because no one can bear the thought of the oil shock that will instantly follow taking 4.2 million barrels a day off the market.

What do you think?